United Airlines sees positive uptick in flight searches, but only for travel next year
United Airlines does not sugar coat pandemic reality. The travel industry has hit bottom and there are few, if any, signs that people are ready to fly again.
New bookings for the Chicago-based carrier are at "net zero" — or bookings minus cancellations — with no near-term sign of improvement, United president Scott Kirby said during a first quarter earnings call Friday. The airline has responded by slashing schedules by 90% through June.
"The real issue for us about demand is going to be that people feel safe and have some reason to travel," he said, noting that guaranteeing clean planes alone will not get people back in the air. "Disney World needs to be open… Cafes and museums in Paris need to be open before people go back, and conventions need to be open and running."
Get Coronavirus travel updates. Stay on top of industry impacts, flight cancellations, and more.
Few Americans are traveling. The latest Transportation Security Administration (TSA) screening data shows just 154,695 people passed through airport checkpoints on April 30, just 6% of the number a year ago. The number of screenings is up slightly from a low of 87,534 on April 14.
In addition, more than 3,000 planes flown by U.S. carriers are idled having not flown during the week ending April 28, according to data from the trade organization Airlines for America (A4A).
Airlines are accelerating aircraft retirement plans to cut costs amid near-zero demand. American Airlines has removed five types from its fleet — Airbus A330-300s, Boeing 757s and 767s, Bombardier CRJ200s and Embraer E190s — and Delta Air Lines will remove its McDonnell Douglas MD-88s and MD-90s in June.
United, for its part, does not yet have plans to retire any of its more than 800 jets. To date, it has only "temporarily parked" aircraft pending a better view of the recovery before any decisions are made, the airline's chief financial officer Gerry Laderman said on Friday.
Related: Delta says goodbye to the last 'Mad Dogs' flying in the US amid coronavirus retirements
United did leave analysts with at least one seed of optimism. The airline is seeing more searches on its website for travel in the spring of 2021 than it did last year for travel this spring, Kirby said.
But a 2021 recovery is a long, long way off. And next year is well after the air service and staffing protections of the government's coronavirus aid package, the CARES Act, expire on Sept. 30.
'We are planning for the environment to possibly continue at essentially net zero passenger revenues for the rest of the year and into 2021," said Kirby. "We aren't projecting that, and certainly hope it's better than that, but we are planning for the possibility."
United is prepared to make difficult strategic decisions based on what it sees over the next few months. These could include involuntary furloughs or layoffs of staff, or even closing one of its eight hubs.
Related: US carriers signal slow recovery with United planning to cut June flying by 90%
The carrier reported a $1.7 billion net loss — its first since 2014 — in the first quarter. It aims to reduce its daily cash loss to $40 to $45 million by the end of June.
Cowen analyst Helane Becker said in a report Friday that United's daily loss projections are a result of the airline's quick response to the COVID-19 crisis. United was the first U.S. carrier to cut domestic capacity in early March.
Both American and Delta aim to get their daily loss, or how fast they are going through the cash in their bank accounts, to around $50 million a day by June.
Related: It may be years until passenger demand returns to 2019 levels for US airlines
TPG featured card
at American Express's secure site
Terms & restrictions apply. See rates & fees.
| 3X | Earn 3X Miles on Delta purchases. |
| 1X | Earn 1X Miles on all other eligible purchases. |
Pros
- Delta SkyClub access when flying Delta
- Annual companion ticket for travel on Delta (upon renewal)
- Ability to earn MQDs through spending
- Various statement credits for eligible purchases
Cons
- Steep annual fee of $650
- Other Delta cobranded cards offer superior earning categories
- Earn 100,000 Bonus Miles after you spend $6,000 or more in purchases with your new Card within the first 6 months of Card Membership and an additional 25,000 bonus miles after you make an additional $3,000 in purchases on the Card within your first 6 months, starting from the date that your account is opened. Offer Ends 04/01/2026.
- Delta SkyMiles® Reserve American Express Card Members receive 15 Visits per Medallion® Year to the Delta Sky Club® when flying Delta and can unlock an unlimited number of Visits after spending $75,000 in purchases on your Card in a calendar year. Plus, you’ll receive four One-Time Guest Passes each Medallion Year so you can share the experience with family and friends when traveling Delta together.
- Enjoy complimentary access to The Centurion® Lounge in the U.S. and select international locations (as set forth on the Centurion Lounge Website), Sidecar by The Centurion® Lounge in the U.S. (see the Centurion Lounge Website for more information on Sidecar by The Centurion® Lounge availability), and Escape Lounges when flying on a Delta flight booked with the Delta SkyMiles® Reserve American Express Card. § To access Sidecar by The Centurion® Lounge, Card Members must arrive within 90 minutes of their departing flight (including layovers). To access The Centurion® Lounge, Card Members must arrive within 3 hours of their departing flight. Effective July 8, 2026, during a layover, Card Members must arrive within 5 hours of the connecting flight.
- Receive $2,500 Medallion® Qualification Dollars with MQD Headstart each Medallion Qualification Year and earn $1 MQD for each $10 in purchases on your Delta SkyMiles® Reserve American Express Card with MQD Boost to get closer to Status next Medallion Year.
- Enjoy a Companion Certificate on a Delta First, Delta Comfort, or Delta Main round-trip flight to select destinations each year after renewal of your Card. The Companion Certificate requires payment of government-imposed taxes and fees of between $22 and $250 (for itineraries with up to four flight segments). Baggage charges and other restrictions apply. Delta Basic experiences are not eligible for this benefit.
- $240 Resy Credit: When you use your Delta SkyMiles® Reserve American Express Card for eligible purchases with U.S. Resy restaurants, you can earn up to $20 each month in statement credits. Enrollment required.
- $120 Rideshare Credit: Earn up to $10 back in statement credits each month after you use your Delta SkyMiles® Reserve American Express Card to pay for U.S. rideshare purchases with select providers. Enrollment required.
- Delta SkyMiles® Reserve American Express Card Members get 15% off when using miles to book Award Travel on Delta flights through delta.com and the Fly Delta app. Discount not applicable to partner-operated flights or to taxes and fees.
- With your Delta SkyMiles® Reserve American Express Card, receive upgrade priority over others with the same Medallion tier, product and fare experience purchased, and Million Miler milestone when you fly with Delta.
- Earn 3X Miles on Delta purchases and earn 1X Miles on all other eligible purchases.
- No Foreign Transaction Fees. Enjoy international travel without additional fees on purchases made abroad.
- $650 Annual Fee.
- Apply with confidence. Know if you're approved for a Card with no impact to your credit score. If you're approved and you choose to accept this Card, your credit score may be impacted.
- Terms Apply.
- See Rates & Fees